Musk’s tweets ‘wrongly valued Tesla’

Image copyright Getty Images Image caption SpaceX’s successful launch from Kennedy Space Center helped Tesla’s stock rise today Tesla was dealt a further blow this week, as one of its creditors said it is…

Musk's tweets 'wrongly valued Tesla'

Image copyright Getty Images Image caption SpaceX’s successful launch from Kennedy Space Center helped Tesla’s stock rise today

Tesla was dealt a further blow this week, as one of its creditors said it is owed $162m (£126m) after Elon Musk tweeted about taking the company private.

The money relates to the Securities and Exchange Commission’s earlier demand that the Tesla CEO stop the take-private plan.

It has offered to settle with the technology company for $20m, but Elon Musk has said he wants to fight the case against him.

The shareholders are set to vote on the company’s take-private bid later this month.

In a statement, New York-based investment firm JPMorgan Chase & Co said it now held the rights to call the 140-character tweets and the resulting stock trades, known as secondary market transactions.

“These securities offerings should be credited as being made for the company by the public markets, and therefore should be treated accordingly,” it said.

“As we understand it, the federal courts concluded that Mr Musk’s tweets from 14 August represent the “true self-representation” of the company.”

Tesla said in a statement that it will “consider the advice of counsel and take the steps needed to determine how to satisfy the claims.”

Musk’s tweets ‘end run’

Earlier this week, J P Morgan said that Mr Musk’s July tweets in which he suggested he could take Tesla private “end run” the SEC and are “inconsistent with the company’s public disclosures”.

On Friday, Tesla’s shares had increased more than 7% in early trading.

The SEC is demanding to know if any of its investors were misled.

The legal action raises questions about how the funds were obtained and potentially signals a wider battle over governance.

Mr Musk’s original take-private bid was $420 per share – almost double the current stock price.

Reuters news agency reported on Monday that since early September, Tesla had stopped recording most social media posts as “public disclosures”, as long as the account is maintained by the CEO.

The $420 offer was withdrawn earlier this month, but the news was not enough to reassure investors.

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